Sunday, October 22, 2006
Rep. Gordon: Get thee to a head and ass-wiring
In a candidate profile published in the Tennessean, U.S. Representative Bart Gordon had this to say about the budget deficit: "One of the main drags on the economy right now are rising interest rates which, to a great extent, are a function of our increasing deficit."
Let's check out what economist Larry Kudlow said recently regarding the deficits and interest rates:
"Believe it or not, there are still people out there who cling to the view that deficits drive up interest rates. How can they justify that when the current interest rate structure is at a 45-year low with the Treasury-bond yield around 4.75 percent?"
As a share of gross domestic product, the deficit is 2.3 percent of the overall economy. That's lower than it's been at any time since 2001, when the economy suffered the double-shock of the Clinton Recession and the September 11 terrorist attacks. Not only is the deficit share of GDP lower than Europe's and almost equal that of Japan's, it's nowhere near the 6 percent of GDP reached during Ronald Reagan's first term.
The fact of the matter is, Keynesian economists and Democratic politicians are the only ones still peddling the canard that deficits cause interest rates to rise. The same Keynesian and Democratic nitwits are the only ones who're willing to make the equally silly claim that deficits in and of themselves do great damage to the economy. To put these people in their place, all one has to do is look at the United States' recent economic history: A large budget deficit did not stop the Reagan Boom in the 1980s, which followed large-scale tax cuts, and a large budget deficit has not stopped the Bush Boom ... which followed large-scale tax cuts. So much for the argument that deficits are always and forever irredeemably bad.
Rep. Bart Gordon needs to get his head and his ass wired together, economically speaking.
Let's check out what economist Larry Kudlow said recently regarding the deficits and interest rates:
"Believe it or not, there are still people out there who cling to the view that deficits drive up interest rates. How can they justify that when the current interest rate structure is at a 45-year low with the Treasury-bond yield around 4.75 percent?"
As a share of gross domestic product, the deficit is 2.3 percent of the overall economy. That's lower than it's been at any time since 2001, when the economy suffered the double-shock of the Clinton Recession and the September 11 terrorist attacks. Not only is the deficit share of GDP lower than Europe's and almost equal that of Japan's, it's nowhere near the 6 percent of GDP reached during Ronald Reagan's first term.
The fact of the matter is, Keynesian economists and Democratic politicians are the only ones still peddling the canard that deficits cause interest rates to rise. The same Keynesian and Democratic nitwits are the only ones who're willing to make the equally silly claim that deficits in and of themselves do great damage to the economy. To put these people in their place, all one has to do is look at the United States' recent economic history: A large budget deficit did not stop the Reagan Boom in the 1980s, which followed large-scale tax cuts, and a large budget deficit has not stopped the Bush Boom ... which followed large-scale tax cuts. So much for the argument that deficits are always and forever irredeemably bad.
Rep. Bart Gordon needs to get his head and his ass wired together, economically speaking.
# posted by Joltin' Django @ Sunday, October 22, 2006 
